How does Google make so much money?

In February 2016, Google briefly surpassed Apple to become the most valuable company in the world, reaching a value of more than US $ 500 billion. However, your search service is free how do you do it ?. See it in graphics.

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Google makes the most of your money by selling the advertising opportunities on the search pages that many of us use.

Advertisers bid to advertise their products or services on the relevant search results pages.

A combination of the size of the offer and the quality of a potential ad influences the position in which it will appear: the most coveted one, of course, is the top of the page, where more users can see it.

In order to foster efficient bidding practices, Google uses a Vickrey auction system. Bidders do not know the offers of their rivals. When all offers come, the highest bidder wins, but actually pays the price that the second highest bidder sent.

But it does not end there.

Google also takes into account the relevance of the advertiser's landing page to the search query.

For example, if an advertiser has a car insurance only page, he would have to make a lower bid to appear above the paid advertising results when a user goesoglea "car insurance" than an advertiser who has an insurance page on general. Google calls this "quality level".

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The attraction of the service to advertisers is that they can target advertising to Google users who have already expressed interest in what the advertiser sells and ignore those who do not.

This is known as contextual advertising .

On the other hand, advertisers only have to pay Google after someone has actually clicked on one of the ads and can set budgets to limit their monthly spending.

Thanks for reading @jackorobin